Wealth accumulation: The long-term impact of ETF investing

Financial analysis highlights the significant long-term impact of investment choices on wealth accumulation. According to calculations by Verivox, choosing an exchange-traded fund (ETF) over a traditional savings account can result in a difference of more than 300,000 euros by retirement age. For example, investing 100 euros monthly starting at age 20 into a globally diversified ETF with a 7.5 percent annual return could yield approximately 403,000 euros after taxes, whereas the same amount in a savings account with 2.5 percent interest would result in only about 102,000 euros.

Data suggests that women are particularly affected by these trends, as they often save smaller amounts for retirement than men. A Verivox survey indicated that 42 percent of women save a maximum of 100 euros per month for retirement, while more than one in three men save over 100 euros monthly.

Experts emphasize that the duration of investment is often more critical than the amount contributed. Utilizing the compound interest effect and diversifying through ETFs can transform small, consistent monthly contributions—even as low as 25 euros—into significant long-term assets. Delaying investment until higher incomes are achieved can lead to a substantial loss of potential wealth due to missed market time and the loss of purchasing power caused by inflation.